In North Carolina, what started with a record state fine over one coal ash facility is now ending with a much smaller price tag that'll cover all of Duke Energy's coal ash facilities. The state environmental department announced Tuesday it's settling the lawsuit, in part because of conflicting guidance from the McCrory and Perdue administrations on fines.
In March, the environmental department hit Duke Energy with a $25 million fine for groundwater pollution at its coal ash facility near Wilmington.
The company appealed, saying regulators didn't follow their own policies. Duke spokeswoman Paige Sheehan points to a 2011 memo from Democratic Governor Bev Perdue's administration.
"That policy applies to all the companies that they regulated that might have groundwater issues," she says. "It is not a Duke policy. It is a policy that the regulator has applied consistently to the many companies that it regulates."
The policy and subsequent communications about it made clear the state would favor fixes instead of fines. So when Republican Governor Pat McCrory's administration hit Duke with the huge fine, "it was a stark departure from that plan," Sheehan says.
State environmental officials now admit that, and they're telling companies that plan won't apply in the future.
The state is lowering Duke's fine from $25 million to $7 million. And now that covers all 14 of its coal ash facilities instead of just one. State officials estimate Duke's costs will be much higher than $7 million because of cleanup, but Duke says those additional costs were part of its plan before the settlement.
Chief Deputy Secretary of the environmental department John Evans says this is still a good deal for North Carolina.
"I've been here 22 years, and it is by far the highest fine that I'm ever aware of by this agency," he says. "And two, it allows us to focus on our resources moving forward to hold Duke accountable for cleanup and closure of these facilities."
This is the latest in a saga that began in February 2014, when more than 30,000 tons of toxic coal ash spilled into the Dan River just south of the Virginia border. Duke has already reached a $100 million federal settlement. And a 2014 state law requires the company to close all its coal ash ponds over the next 15 years.
